There are many different views as to why inflation exists, all of which agree that it is affected, to a large degree, by an increase in the supply of money in an economy.  Read more about it here.

To remove Inflation, the Registry uses time as the common commodity, as it grows the same amoungst all individuals.  It does this by preventing how much you can sell something for based on this amount of time.  However, time isn't money, it is converted into money when a utility is sold.  

The theory in economics is that inflation occurs because as more money is available to everyone, they have more of it to spend on something and are willing to pay for it so prices go up - the value of the dollar is relative.  In the registry, everything that is in high enough abundance is cheap.  People will still want to spend the least amount of money on what they value the most for their dollar because they will want to hold onto their money to use it during situations of scarcity and competition. The value of money is retained even as more enters the system, generally speaking, because people will use it when they want THEIR TURN over someone else, now.  The Registry does better than the 'I was here first' game we play.

The total amount of spendable money (Exchange) in the system is increased every time a transaction on a utility with a supply more than 1 occurs. It also increases continously as the population decides to exchange their unutilized time for money.

The total amount of money in the system is destroyed every time someone pays more to someone who has already received more than the time that has elapsed or recovering the cost of goods.  It is also decreased whenever someone performs a criminal activity.  Finally, money is destroyed when individuals purchase and use utilities which are deemed scarce by the members.

Inflation, in todays economy, is also caused when banks loan money as this increases the amount of money supply in the system.  Loans are not required in the registry.